The National Economic and Social Development Board (NESDB) said it now expects 2018 expansion in the range of 4.2 to 4.7 percent – up from an earlier projection of 3.6 to 4.6 percent – after the economy grew at the fastest pace in 20 years for the three months of the year.

NESDB deputy secretary-general Wichayayuth Boonchit said gross domestic product (GDP) rose 4.8 percent year on year for the quarter, driven by an acceleration in spending by the public and private sectors.

Thailand had suffered GDP contraction of 0.4 percent in the first quarter of 2014, the worst performance for a quarter for the preceding five years.

For opening quarter of 2018, total investment edged up 3.4 percent from the year-earlier period. Public investment increased 4 percent.

Exports expanded 9.9 percent, while tourism-based income jumped 16.8 percent.

With the NESDB’s revised GDP growth forecast of 4.2 to 4.7 percent, the median estimate is 4.5 percent.

The health of the global economy and robust product prices have been cited as factors behind the strong growth performance.

The trend of rising exports is expected to firm up and the nation’s stronger economic base is likely to spur industrial expansion – aided by expenditure flows from the government.

The NESDB expects exports to grow 8.9 percent for 2018, with public spending likely to rise 3 percent and private investment in the order of 3.9 percent. Private consumption is estimated to increase 3.7 per cent. Average headline inflation is projected in a range of 0.7 to 1.7 percent.

Thailand’s current account is forecast to enjoy a surplus that amounts to 8.4 percent of the nation’s GDP.

However, risks to growth loom in the form of increased prices for certain products and crude oil, along with expected rises in interest rates, amid global economic and financial uncertainties

Deputy Prime Minister Somkid Jatusripitak said he drew encouragement from the 4.8 percent GDP marking the fastest growth in five years.

Broad indicators rising

The government had spent most of the past five years driving forward the economy, he said.

All economic indicators, including private investment, exports, and tourism receipts, had improved, he said, adding the prolonged pressures in the agricultural sector had eased.

Somkid said that the strong GDP expansion was likely to raise the confidence of the private sector, increasing the prospects of greater corporate income.

If the scale of investment through public-private partnership (PPP) plans proceeds as planned, businesses in a range of activities will be boosted, with infrastructure and property projects to follow, he said.

Meanwhile, a meeting of the PPP committee chaired by Somkid, yesterday resolved to accelerate the pipeline of such projects. Three big projects are expected this year with an investment of about Bt446.87 billion, according to Prapas Kong-Ied, director-general of State Enterprise Policy Office.

They are the Bt80.6-billion Nakhon Pathom-Cha-am intercity motorway, the Bt128.23 billion Tao Poon-Kanchanaphisek Ring Road mass rapid transit system, and the Purple Line’s Bt238.04-billion eastern and western section MRT project.

The Siam Commercial Bank Economic Intelligence Centre forecasts the economy will grow more than 4 percent this year, citing the 4.8 percent expansion achieved for the first quarter.

The center’s confidence is based on encouraging signs across all sectors of the economy, as well as a reduction in household debt. These factors will boost consumer spending throughout the rest of the year, it said.

The Bank of Thailand’s senior director for the economy and policy department, Don Nakornthab, said yesterday that the economic expansion for the year’s first three months had exceeded the central bank’s expectations.

Don also highlighted the contributions from investment by the private and state sectors, as well as increased domestic consumption. He said the Bank of Thailand would announce next month a fresh estimate of economic expansion for 2018.

However, Don cautioned that the economy faced a range of risks – both internal and external. The latter included uncertainties over global trade policies and rising oil prices. On the home front is the issue of how well domestic consumption will hold up.

The original mass transit light rail train in Bangkok was developed by the BTS Group to run the above ground train along Sukhumvit Road. Not too long after in 2004, an underground subway system was constructed, which was developed and run by another company called Mass Rapid Transit Authority of Thailand (MRTA).

Traditionally, these two trains have been considered separated with the BTS being “the sky train” and the MRT being “the subway”; however massive expansion of both systems have been underway for the past few years and soon the MRT will have both above and below ground lines. By 2025, Bangkok will have more mass transit lines than London if there are no major delays, which is quite impressive considering that it took London almost a century to build up its train network to what it is today. Thailand will have done so in around a third of the time.

Currently, Bangkok has 110 kilometers of mass transit light rail lines encompassing 78 stations in Bangkok. Another 193.2 kilometers is currently under construction which encompasses 126 stations due to be complete by 2020. A planned 147.1 kilometers with 70 stations are in the plan for completion between 2021 and 2025. From 2013 to 2017, the BTS green line had the highest ridership of 744,499 passengers per weekday followed by the MRT blue line at around 349,000 passengers per weekday.

The MRT purple line, linking Tao Poon to Khlong Bang Phai, was recently opened in 2016 to underwhelming ridership numbers. This was due in large part to a lack of connection between the blue line end station of Bang Sue and the purple line starting station of Tao Poon. Last year, they fixed that issue connecting these two stations together and ridership jumped from around 33,130 riders per weekday to 48,992 riders, which is still not as high as they had hoped. Another train system that should be mentioned is the Airport Rail Link (ARL) which can be accessed from around Phaya Thai BTS Station and connects to Suvarnabhumi Airport. This system has been relatively underused since its completion in 2010 carrying only around 67,631 passengers per weekday, most of which are commuters rather than airline passengers going to and from the city to the airport area stations.

The expansion plans for the light rail system in Bangkok and surrounding areas is quite extensive but the blue line is one that is worth highlighting.

As mentioned above, the blue line is part of the MRT system that currently runs from Hua Lamphong to Bang Sue; however, the expansion of this line will create the first full circle route which should create a much more seamless riding experience for passengers resulting in higher ridership than the current blue line.

The blue line is going to extend across the river to Thonburi side out to Bang Khae but also loop north to connect with Tao Poon station with an interchange at Tha Phra. This loop should lead to a significant increase in ridership as the route takes riders through many important locations such as China Town, Hua Lamphong, Lumpini, Sukhumvit, Rama 9, Ratchada, Lat Phrao, Chatuchak and then over across the Chao Phraya River into Thonburi. The Thonburi link is significant as current road routes are often very congested, especially at peak hours. The train will provide a new option that can get travelers to many key areas of Bangkok where they can then connect to other routes or walk to their destinations.

This could lead to a revitalization of the old Chinatown area, especially as a tourist destination.

Apart from this key route, the BTS and MRT line extensions when completed and combined will allow riders of the rail transport system to connect to virtually all the primary downtown and midtown areas of Bangkok. This improvement should also encourage tourists to venture out further from downtown Bangkok since tourists must rely on public transportation. Having a fixed rail route will give them more confidence to explore further out of Bangkok Central Business District (CBD) without the fear of getting lost or stuck. Furthermore, these new routes, especially locations along the blue line loop should make for good opportunities for developers of residential, retail, office, and hotel projects as access to these properties will be superior thanks to extensive connections to the blue line.

Ultimately implementation will be a large driving factor that will affect ridership.

This includes efficiency of payment methods such as the “spider card” that’s been proposed which allows one card to be used on all public transport systems as opposed to the mutually exclusive systems currently used. Safety in terms of security and equipment maintenance and timeliness of the trains will also affect rider trust and usage.

We still have seven years of construction to go just to complete the current planned network, but it is a positive sign to see progress being made on these construction plans which would make Thailand’s light rail system one of the most advanced and comprehensive in the region.

Noted: Writer by  Aliwassa Pathnadabutr, Managing Director of CBRE Thailand